Opportunistic Trader Overnight Recap

Non Farm Payroll Expectation +200,000 job gains in November (release at 8:30AM EST)
What will OPEC Cut?
What is next with Huiwei CFO and what does it mean for global trade?



World stock markets were mixed but stable overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins.

There is still some anxiety in the world marketplace Friday, following the news Thursday that Chinese tech giant Huawei’s chief financial officer was arrested in Canada, on behalf of the U.S., and the U.S wants to extradite her. China has called on Canada to release her, ahead of her scheduled hearing on extradition to the U.S. today. This matter has sparked fears U.S.-China trade tensions could rise further despite the recent agreed-upon truce.

Traders and investors are awaiting what is arguably the most important U.S. economic report of the month: the Labor Department Employment Situation Report for November, released this morning. The key non-farm jobs number in the report is forecast at up 198,000. Given the recent talk of a slowing U.S. economy and maybe a less hawkish Federal Reserve heading into 2019, today’s jobs report will be even more closely scrutinized by the marketplace.

In overnight news, the Euro zone economy grew at a paltry rate of 1.6% in the third quarter, year-on-year, which was slightly less than forecast.

The key outside markets today find the U.S. dollar index near steady. Meantime, Nymex crude oil prices are also near steady following another drop Thursday. The OPEC oil cartel is meeting in Vienna, Austria again today. Reports said OPEC heavyweight Saudi Arabia has not agreed to a production cut and is now skeptical an agreement can be reached. This has many crude oil market watchers wondering about any collective production cut being extended, after most reckoned such would be the case before the meeting began.

Other U.S. economic data due for release Friday includes the University of Michigan consumer sentiment survey, monthly wholesale trade and consumer credit. There are also a couple of Federal Reserve officials speaking today.

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are lower in early U.S. trading today. Bears are in technical command. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 2,702.75 and then at 2,725.75. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,650.00 and then at this week’s low of 2,625.50. Sell stops are likely located just below those levels.

March Nasdaq index December futures: Prices are lower in early U.S. trading. Bears are in technical control. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 6,881.00 and then at 6,900.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 6,750.00 and then at 6,700.00. Sell stops are likely located just below those levels.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices were weaker overnight on mild profit taking after hitting a three-month high Thursday. Bulls are in solid technical control. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the overnight high of 143 9/32 and then at Thursday’s high of 143 26/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 142 19/32 and then at 142 4/32. Sell stops likely reside just below those levels.

March U.S. T-Notes: The market was slightly lower overnight on profit taking after hitting a 3.5-month high on Thursday. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 120.16.0 and then at 120.20.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 120.07.5 and then at 120.00.0. Sell stops likely reside just below those levels.

U.S. DOLLAR INDEX

The March U.S. dollar index is near steady in early U.S. trading. Bulls still have the overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the dollar index are neutral to bearish early today. The dollar index finds shorter-term technical resistance at this week’s high of 96.610 and then at 96.750. Shorter-term support is seen at 96.000 and then at this week’s low of 95.750.

NYMEX CRUDE OIL

January Nymex crude oil prices are near steady in early U.S. trading today. Bears are in firm overall near-term technical control. There are still no early clues that a market bottom is close at hand. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at $52.00 and then at $52.50. Look for sell stops just below technical support at the overnight low of $50.60 and then at $50.00.

GRAINS

Grain futures prices were narrowly mixed overnight. Traders will closely examine this morning’s weekly USDA export sales report, delayed by one day due to the national day of mourning on Wednesday. There are new worries about an escalation of the U.S.-China trade war that will limit the upside in the grains. The grain market bears still have the overall near-term technical advantage, but it does appear corn and soybean prices have put in harvest lows.